In 2017, crypto had a single liquidity channel dominated by retail, revolving around the idea of “stacking sats.” BTC entered the liquid market of coins, and people traded Bitcoin against altcoins to potentially make more bitcoins—that was the single and common liquidity

After the rise of ICOs, the market found another channel that served the same purpose of stacking sats—the goal remained the same from 2016-19. In the bear cycle, we saw a rise in futures trading, where BTC was used as collateral to take leverage, again with the same goal of

In the last cycle, we saw an influx of new money with a different mindset—mostly people looking to make quick cash. The goal of stacking sats was never discussed in the new circle; they all wanted more cash.

The market shifted from ALTBTC to ALTUSDT, and ALTUSDT pairs started getting more trading volume than ALTBTC pairs. We also saw the creation of new liquidity channels—DeFi and NFTs.

Communities were built around them, and people farming yield in DeFi summer or flipping NFTs had the common goal of stacking ETH. ETH had more upside potential in the last cycle, and it worked because ETH ended up outperforming BTC, making people more money.

By the end of the last cycle, we had 3 liquidity channels: 1/ People putting stables in alts and making alts in return. 2/ People putting ETH in DeFi farms and NFTs and making ETH in return. 3/ People putting BTC in alts and making BTC in return. People accumulated gains in

Now, in the bear market, most stables moved into BTC when alts went through a death phase, leading to increased BTC liquidity from retail. Institutional buyers had already started buying BTC, making BTC the biggest liquidity channel in the market.

This liquidity became massive after the Spot ETF launch in the US. Now, Bitcoin liquidity might cover 70-80% of the total market liquidity, and it may never return to altcoins. around $100B worth of liquidity in locked in Bitcoin ETFs right now.

People who have been through a couple of cycles understand BTC’s nature and don’t want to take higher exposure in any alt. Those with at least 1 BTC would probably keep 70% exposure in BTC at any point—so the liquidity channel is blocked to an extent.

Some of this liquidity moved to SOL, as it became the new retail liquidity channel where people traded memes and stacked SOL—and they are still doing it.

So at the current stage, we have multiple liquidity channels of different sizes: 1/ BTC Liquidity (ETFs/Retail/Institutions) 2/ Stables (Supplied on Lending Platforms, Holding in wallets) 2/ ETH Liquidity (Locked in DeFi/NFTs/Staking/Restaking) 3/ SOL Liquidity (Staked/rotating

Right now, meme liquidity from SOL rotation and new liquidity from airdrop selling are the only liquid sources from retail moving into different narratives. Meme liquidity is chasing instant gratification, avoiding large caps or alts, and choosing markets where ROI could be

This will lead to the creation of new liquid markets like AI agents in the future. Once liquidity rotates to a narrative, new bag holders are born, and speculation attracts liquidity from outside the genesis cluster. For example, AI agents pulled liquidity from ETH, airdrops,

A key factor in liquidity rotation and locking is belief—HODLing for the long term. That’s what happened with AI agents. Since builder energy in the space is intact, we might see more waves around these coins, similar to how memes found new waves after long corrections.

At the same time, we should be prepared to witness the creation of more liquidity channels in the coming years. Most of these will align with the interests of people with liquidity and their goals.

The common goal right now is feeding the instant gratification energy of retail entering through the SOL liquidity channel. But in the near future, we could see the creation of long-term and sustainable liquidity channels for projects with positive cash flow—mainly large caps

This would invite more serious players with large capital, marking the beginning of the first bull cycle under authoritarian control, while smaller liquidity channels continue to create gains and losses in a total crypto anarchy state.

In coming months, we could expect two things: 1/more liquidity rotation from meme, agents to other new shiny narratives 2/ Inbound liquidity channel creations post-regulation for some alts—mainly those that have survived the inflection point of validation and are going through

I hope you enjoyed reading this thread. If you appreciate my work, please like, share, and repost the tweet below

Nothing like what you seen in the past. It’s going to be the first ever alt cycle in a new environment. Forget everything what you have seen in the past— and adapt the new nature of the cycle which has not been started yet. The new cycle will favour actual adoption more.

Thank you :)

No that’s not gonna happen. It’s better to move from past memories

Creator coins.

Would recommend to read the article I wrote separately which goes deep into the second part which talks about the divide between two words. You will find that on profile, wrote last week.